Chinese company buys slice of Cemig in Santo Antônio hydroelectric power plant

The Chinese State Power Investment Overseas (Spic) presented on Tuesday, 27, a proposal to buy the participation of Companhia Energética de Minas Gerais (Cemig) in Santo Antônio hydroelectric power plant, in Rondônia. The Minas Gerais State holds 22.4 percent of the plant, of 3,568 MW, through companies Cemig Geração e Transmissão and SAAG Investments. In a statement to the market, the State-owned Mines States that the proposal will deliberate by the company''s governance.
The talks to sell the stake in Madeira River power plant began a few months ago. In addition to the slice of Cemig, the Chinese company also negotiates the acquisition with the other partners of the hydroelectric plant. One of them is the Odebrecht Energia, which owns 18.6% stake in Santo Antônio. In this case, the company still negotiates the terms and conditions for a purchase agreement. Per table, the share of Eletrobras on hydroelectric could also be sold as already stated the President of the federal State, Wilson Ferreira Junior.
The total value of 100% of the assets of the Santo Antônio is estimated at around R $9 billion. But, at the beginning of the negotiations, the expectation was that a value be paid would be much smaller: between R and R $7 $6 billion billion. The remainder would be linked to compliance with performance targets and should be in installments. Cemig has not reported the value of the proposal made by China yesterday by your participation.
Since the power plant was put up for sale, the partners came doing road show in several countries to present the project. Odebrecht, for example, went to China, where he offered your participation to various other companies, in addition to the Spic. In the list of companies that have looked at the power plant, were the China Three Gorges and the Canadian Brookfield. But in both cases the conversations were not ahead. With the proposal made yesterday by Cemig, the expectation of market analysts is that the other negotiations are accelerated so that the purchases are made simultaneously.
For Cemig, the sale gives breath to your box, since it has a number of commitments to honor this year and the next.
The company announced a disinvestment program that can overcome R $6 billion, including the sale of holdings in electric power transmission companies and also Rio de Janeiro distributor Light. In a recent interview with the associated press/Broadcast, the President of the company said that the sale of State assets is a necessity.